media and analyst day presentation 2010

Analyst & Media Day 17/09/2010 © Ascom Network Testing 1

ANALYST & MEDIA DAY ZURICH

Network Testing

Friday, 17 September 2010


AGENDA PROGRAM

ABOUT ASCOM

H1 AT A GLANCE

NETWORK TESTING


PROGRAM: FRIDAY, 17 SEPTEMBER 2010

From 12:30 Standing Lunch13:30 – 13:45 Welcome Address

Riet Cadonau, CEO13:45 – 14:30 Presentation Division Network Testing

Markets today & tomorrow Customer references

Rikard Lundqvist, General Manager Network Testing14:30 – 15:00 Product Overview

Customer needs Our offering

Erik Tarnvik, VP Marketing Network Testing

[ ANALYST & MEDIA DAY ]


15:00 – 15:15 Coffee break

15:15 – 16:00 Product Presentation Network Testing Product Portfolio:

www.ascom.com/networktesting

Jaana Tengman, Director of Product ManagementThomas Renz, Product Management

16:00 – 16:30 Closing Words / Q&A

From 16:30 Drinks

[ ANALYST & MEDIA DAY ]

PROGRAM: FRIDAY, 17 SEPTEMBER 2010


ABOUT ASCOM

Analyst & Media Day 17/09/2010 © Ascom Network Testing

The SeCom division specializes in secure, reliable communication solutions for alerts, mobilization, and tactical communication both for military and civilian use. www.ascom.com/security-communication

The NT division is a global market leader in testing and optimization solutions for mobile networks.www.ascom.com/networktesting

COMMITT

The WS division is a leading specialist in wireless on-site communication solutions for segments as hospitals, elderly care, industry, retail, hotels and secure establishments.www.ascom.com/wireless-solutions

66

[ ASCOM GROUP ]

ABOUT ASCOM

Ascom is a business-to-business provider of customized communication solutions in niche markets. The company focuses on Mission-Critical Communication in the following core areas:

Wireless Solutions Network Testing Security Communication

http://www.ascom.com/security-communication�



http://www.ascom.com/networktesting�

http://www.ascom.com/wireless-solutions�




H1 2010 AT A GLANCE: STRONG H1 RESULTS OF ASCOM GROUP


H1 2010 FINANCIAL RESULTS OVERVIEW

CHFm H1 2010 H1 2009

Incoming orders 308.2 233.8

Revenue 281.2 235.2

EBIT 24.0 7.3

EBIT margin 8.5% 3.1%

GROUP PROFIT 17.1 11.9

EBITDA 33.9 12.3

EBITDA margin 12.1% 5.2%

[ H1 2010 AT A GLANCE ]

8

Improvement in all targets


ALL THREE DIVISIONS IMPROVED PROFITABILITY

Security Communication

EBIT margin 8.1% (H1 2009: 5.1%); EBITDA margin 9.0%


Ascom is a healthy company and shows profitable growth

Wireless Solutions

EBIT margin 10.1% (H1 2009: 5.3%); EBITDA margin 12.5%

Network Testing

EBIT margin 8.0% (including integration and amortization costs of CHF 6.9m)

EBITDA margin 15.4%


OUTLOOK 2010

Organic growth on Group level compared to prior-year*

Guidance increased > New target for 2010 on Group level:* EBITDA margin: 11-12%

The company intends to pay an annual dividend starting from 2011, provided a well ongoing course of business

*provided that the economic environment remains stable and there is no deterioration in currency relations



NETWORK TESTINGEVOLVING NETWORKS. TRUSTED SOLUTIONS.


Mob

ile N

etw

ork

Test

ing

1212

Mobile Test Solutions

[ NETWORK TESTING ]

+ Comarco WTSJanuary 2009

+ TEMSJune 2009

+ ArgogroupMarch 2008

NETWORK TESTING

ASCOM MADE A SUBSTANTIAL LEAP FORWARD

existing

Set-up of a third Ascom pillar


[ NETWORK TESTING ]

NETWORK TESTING PRESENTATION TEAM

13

Product Segment ManagerThomas Renz

VP Product Management & MarketingErik Tarnvik

General ManagerRikard Lundqvist

Director of Product ManagementJaana Tengman

http://www.ascom.com/en/index/group/group-management/executive-board/rikard-lundqvist.htm�


THANK YOU!

Analyst & Media Day, 17/09/2010 © Ascom Network Testing 1

ANALYST & MEDIA DAY ZURICHNetwork TestingFriday, 17 September 2010


EVOLVING NETWORKS. TRUSTED SOLUTIONS.

NETWORK OPERATOR CHALLENGES

3Analyst & Media Day, 17/09/2010 © Ascom Network Testing

Network Testing

Reston

NETWORK TESTING – A GLOBAL MARKET LEADER

575+ employees in 20+ countries

Headquarters

20+ employees

6-20 employees

1-5 employees


Core segments

Product/Service offering

Go-to-market

Growth driver

Telecom operators Telecom infrastructure vendors Telecom professional service providers Telecom regulatory agencies and other government entities Telecom content providers

Radio air interface network performance, network quality of service, and services monitoring & testing: Products

Systems Solutions Services 1)

Global presence Direct channel: Offices in more than 20 countries Indirect channel

Increasing demand of mobile broadband services Market growth driven by LTE standard

5

1) incl. Systems & Solutions (Application Development for Telecom Carriers)

Test & Measurement Benchmarking & Monitoring Reporting & Analysis

NETWORK TESTING

Analyst & Media Day, 17/09/2010 © Ascom Network Testing

BLUE-CHIP CUSTOMER-BASE

Operator Subscribers

(millions) Ascom

customer China Mobile 493 China Unicom 140 Bharti 102 Verizon Wireless 88 Reliance Communications 81

AT&T Mobility 80 Vodafone Essar 76 Telkomsel 69 Mobile TeleSystems 67

Radiomóvil Dipsa 58 NTT DoCoMo 55 VimpelCom 50 BSNL 50 Sprint Nextel 48 Idea Cellular 47 Vivo 47 MegaFon 45 Claro 42 Viettel 41 China Telecom 40

Source: Informa Telecoms & Media, World Cellular Investors –Quarterly Datasheet, September 2009 (data as of June 2009)


Selected customers in EMEA

Selected customers in America

Selected customers in Asia

Global top 20 operators

http://images.google.co.uk/imgres?imgurl=http://blog.tmcnet.com/blog/tom-keating/images/at-t-logo.jpg&imgrefurl=http://blog.tmcnet.com/blog/tom-keating/voip/att-callvantage-major-outage.asp&h=332&w=250&sz=20&hl=en&start=2&tbnid=_NNzPlQSJTL_zM:&tbnh=119&tbnw=90&prev=/images?q=at&T+logo&gbv=2&hl=en�

http://www.bharti.com/�

http://www.etisalat.ae/index.jsp?lang=en�


NETWORK TESTING PORTFOLIO SEGMENTS

Test & Measurement

Benchmarking & Monitoring

Reporting & Analysis

“for troubleshooting and optimization”

“for quality of service and experience”

“for post processing and optimization”

Individual probes to test and evaluate the performance and quality of wireless networks and services.

Dedicated probe systems to benchmark and monitor the performance and quality of wireless networks, services, and content.

Software to visualize, analyze, and report mobile network performance and quality.

TEST & MEASUREMENT BENCHMARKING & MONITORING REPORTING & ANALYSIS

62% of 2009 sales 33% of 2009 sales 5% of 2009 sales

OFFERING

TEMS Investigation

TEMS Pocket

TEMS Symphony Suite

TEMS Automatic

TEMS Monitor Master TEMS Box Office

TEMS Visualization

TEMS Discovery


COMPETITORS

9

TEST &MEASUREMENT

BENCHMARKING & MONITORING

REPORTING & ANALYSIS


http://www.qualitest.com.br/eng/index.asp�

http://www.swissqual.com/default.aspx�

10

MARKET POSITION 2009

Approximately 30% Ascom share of Network Testing market estimated at 430 MUSD

Sources: 1. Service Assurance Market Review, June 2009, Analysis Mason. 2. Service Fulfillment Market Review, July 2009, Analysis Mason. 3. World Wireless Test & Measurement Equipment for Installation and Maintenance Applications, February 2009, Frost & Sullivan. 4. Company financial reports. 5. Ascom analysis

Benchmarking & Monitoring135 MUSD

Analyst and Media Day, September 2010 © Ascom

Test & Measurement215 MUSD

Reporting & Analysis80 MUSD

11

ADDRESSABLE MARKET – FORECAST

Transitioning

Developing

DevelopedEconomies

Approximately 5% CAGR 2010 – 2014 driven mainly by 3G+ and 4G rollouts

MUSD


Sources: 1. World Cellular Information Service

Subscriber Forecasts, June 20102. World Wireless Test & Measurement

Equipment for Installation and Maintenance Applications, February 2009, Frost & Sullivan

3. Informa Telecoms & Media, World Cellular Forecasts 2009-2015, March 2010

4. Service Assurance Market Review, June 2009, Analysis Mason

5. Service Fulfillment Market Review, July 2009, Analysis Mason

6. UBS Global I/O: Telecom Equipment: 7September 2010

7. Ascom analysis

$0

$100

$200

$300

$400

$500

$600

2010 2011 2012 2013 2014

PRIORITIES

Grow faster than the addressable market

Lead in support for emerging mobile technologies (3.5 – 4G)

MARKET Maintain mid- to high-end brand in mobile network testing

Strengthen global distribution, delivery and support organizations

TECHNOLOGY

GROWTH

EXECUTION


GROWTH DRIVERS


1. NEED FOR COMMUNICATION USING EXISTING NETWORKS

2. DEPLOYMENT OF NEW NETWORKS & INCREASING COMPLEXITIES

SUBSCRIBER NEEDS


More places, more often, many different ways & services

Expecting – Demanding - Depending on

Expecting lower prices – More for less

Individual communication increasingly wireless

5.9 bn subscribers 50 bn connections (2020)

Ascom helps operators meet subscriber needs

0

5

10

15

20

2008 2009 2010 2011 2012 2013 2014

Data

Voice

GLOBAL MOBILE NETWORK TRAFFIC

15

Growth of data traffic leads to network builds and expansions

Millions of TB per annum

Sources: 1. Future Mobile Networks, January 2010, Informa Telecoms & Media

Analyst and Media Day, September 2010 © Ascom

Internet

Enterprise

Mobile applications

Messaging

TV and video

Games

Location services

Banking/mobile pay/NFC

Marketing and Advertising

Social networking

Location services

DRIVERS

OPERATOR CHALLENGES


Large investments – Need to start to make money quick

New technologies - coexisting with legacy technologies

While customers demand more for less – the ways to deliver don’t get easier

Supporting legacy cash-cow networks while deploying new networks

Essentially same number of people

Operator challenges represent business opportunities in Network Testing

17

P

Early activity in North America in 2010.Asia Pacific leads LTE (4G) in 2011-12, followed by Western Europe.

GLOBAL LTE (4G) ADOPTION – SUBSCRIBERS

Network Buildout Momentum

Sources: 1. World Cellular Information Service +

0

20'000'000

40'000'000

60'000'000

80'000'000

100'000'000

120'000'000

140'000'000

2009 2010 2011 2012 2013 2014

Africa

Americas

Asia Pacific

Europe: Eastern


18

P

Early activity in North America in 2010.Asia Pacific leads LTE (4G) in 2011-12, followed by Western Europe.

GLOBAL LTE (4G) ADOPTION – SUBSCRIBERS

Network Buildout Momentum

Sources: 1. World Cellular Information Service +

0

20'000'000

40'000'000

60'000'000

80'000'000

100'000'000

120'000'000

140'000'000

2009 2010 2011 2012 2013 2014

Africa

Americas

Asia Pacific

Europe: EasternLTE is coming…

But significant momentum not expected before 2012


19

20105.3 billion

Majority of subscriptions in Developing economies.Global technology shift toward 3.5G+.

SUBSCRIPTIONS BY REGION & TECHNOLOGY GENERATION

2G3G3.5G+

20136.9 billion

Sources: 1. World Cellular Information Service +2. Ascom analysis

2G3G3.5G+

2G3G3.5G+


Developing countriesCountries in transitionDeveloped countries

20

20105.3 billion

Majority of subscriptions in Developing economies.Global technology shift toward 3.5G+.

SUBSCRIPTIONS BY REGION & TECHNOLOGY GENERATION

2G3G3.5G+

20136.9 billion

Sources: 1. World Cellular Information Service +2. Ascom analysis

2G3G3.5G+

2G3G3.5G+Technology shifts & concurrent technologies

increased complexities


Developing countriesCountries in transitionDeveloped countries

GROWTH DRIVERS


1. NEED FOR COMMUNICATION USING EXISTING NETWORKS

2. DEPLOYMENT OF NEW NETWORKS & INCREASING COMPLEXITIES

We help operators deliver – cost efficiently

We increase the speed of technology rollouts and provide critical insights


Infrastructure Roll-out Verify that network implementations work as intended.

Troubleshooting Identify and analyze problems in their networks.

Benchmarking of competition Compare their networks with competitors networks, for marketing or other purposes.

Monitoring the Network Ensure that their network continuously functions and performs as intended.

Ascom Network Testing helps operators to understand their customers experience from a technical perspective and improve

how customers perceive their networks

WIRELESS OPERATORS NEED NETWORK TESTING SOLUTIONS

NETWORK TESTINGEVOLVING NETWORKS. TRUSTED SOLUTIONS.


INFRASTRUCTURE ROLLOUT – THE CUSTOMER NEED EXPLAINED


Rollout activities are very large projects and occur when an operator:

Enters into operation – green field.

Goes through a technology shift and adds new technology their network. GSM -> WCDMA CDMA -> LTE Typically requires major adjustments to existing

installations as well as new installations of network elements.

Adds capacity or features to the network


INFRASTRUCTURE ROLLOUT – THE CUSTOMER NEED EXPLAINED

GLOBAL BASE STATION FORECAST ALL TECHNOLOGIES


INFRASTRUCTURE ROLLOUT WHY IT DRIVES ASCOM’S BUSINESS


Ascom provides leading drive test solution - TEMS Investigation

Used for Initial Tuning and Final Acceptance of network

No traffic yet in network = drive testing


Initial Tuning and Final Acceptance are critical activities: Network Operator - to know they have a working network Network Equipment Manufacturer - to get paid

Necessity

Volume

Longevity

Volume - Base stations typically rolled out in parallel by several teams – multiple test products needed.

Technology Evolution drives need to continuously update or re-purchase drive test products in order to support the latest and greatest technology.

INFRASTRUCTURE ROLLOUT WHY IT DRIVES ASCOM’S BUSINESS



OFFERING

TEMS Investigation

TEMS Pocket

TEMS Symphony Suite

TEMS Automatic


TEMS Visualization

TEMS Discovery


TEMS Investigation

Data collection and real-time troubleshooting− Industry’s broadest support for devices - over 200 different terminals and scanners− Supports all major technologies− Industry’s broadest support for LTE: agreements with Samsung, LG Electronics,

Qualcomm and ST Ericsson− Data collection as well as service testing− Drive testing and indoor data collection

On-screen “light” post-processing− Multiple means of presentation and total flexibility− Single log file replay as well as post-processing of multiple logfiles− Compatible with TEMS Discovery Professional for advanced post processing

Reporting− Technology-related RAN tuning and acceptance reports− Statistical KPI reports

ASCOM’S SOLUTION AND WHAT’S IMPORTANT


BENCHMARKING – THE CUSTOMER NEED EXPLAINED


Benchmarking – comparative evaluation of one network against another – is typically performed for two reasons:

To support marketing claims – legally and commercially – “our network is better, faster, drops less calls, has better 3G coverage” etc.

To find and address network weaknesses in key areas

“The right marketing strategy based on benchmarking dictates shifts in market share, in

particular in mature markets.”


BENCHMARKING – WHY IT DRIVES ASCOM’S BUSINESS



OFFERING

TEMS Investigation

TEMS Pocket

TEMS Symphony Suite

TEMS Automatic


TEMS Visualization

TEMS Discovery


ASCOM’S SOLUTION AND WHAT’S IMPORTANT


TEMS Symphony Suite

Benchmarking systems up to 24 networks at a timeAll major radio technologiesServices: Speech, video, SMS, MMS, IP-data testing (FTP,

HTTP, WAP, Ping, UDP, e-mail)Real-time speech and video quality testing on multiple

networks in parallelScalable CPU powerRugged DesignNew even more powerful Hardware Solution coming in 2011!


THANK YOU!

media and analyst day presentation 2010

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